The problem with earmarks Thursday, December 01, 2005 Increasingly, Congressional earmarks are being used to create anchor investments in potentially new clusters. For example, last week, U.S. Rep. G.K. Butterfield of North Carolina announced that he had secured an earmark of $1.5 million for the Advanced Vehicle Research Center through the Energy and Water Development Appropriation for fiscal year 2006. The center will be located in rural Northampton County (pop, 21,000, near Roanoke Rapids). Read more. In another example, a representative from North Carolina got a bunch of funding for a new center on regenerative medicine. Read more. The trick is that politics is not a really good predictor of markets. Anchors like these need to attract private investment if they are to be sustainable. The earmark process does not provide any rational way to evaluate whether a given investment has the potential to leverage private dollars. But Rep. Butterfield's project is chump change compared to Senator Grassley's $50 million for his indoor rain forest. Perhaps embarrassed by the scope of a project that provides $50 million in federal funds to build a rain forest in rural Coralville, Senator Grassley is proposing legislation now that requires project leaders to raise at least $50 million in private funds by December 2007 before federal funding can be used. To give himself a little political cover, he now wants to mandate leverage. Read more. posted by Ed Morrison |		This work is licensed under a Creative Commons License. links Some Background on EDPro Weblog The purpose of this weblog is to help economic development professionals -- EDPros -- keep up with the changes sweeping our profession. Strap on your goggles. It's a whole new game. There are no experts any more. The only place to learn about economic development is from other EDPros who are doing it. One other point: the prevaling approach (paradigm, if you like) in economic development is shifting from competition to collaboration. There are a lot of reaasons underlying this shift, but here's the important insight: You, your community, and your region will do better by collaborating and sharing information. So, spread the word...Share the knowledge. Tell a friend about EDPro Weblog. If you are using a news reader, here is the link to syndicate this site: Here's the link if you are a bloglines subscriber: Speaking and workshops on Open Source Economic Development As the idea of Open Source Economic Development starts spreading, more people are asking about it. Visit the I-Open web site to learn more. My colleagues and I are happy to explain the basic concepts in a talk or a workshop. E-mail Susan Alshuler if you'd like to learn more about workshops and speaking. Background on Ed Morrison Download some background information on me here.

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